Buy State Bank of India, target price Rs 605: ICICI Direct

ICICI Direct has buy call on State Bank of India with a target price of Rs 605. The current market price of State Bank of India is Rs 462.55. Time period given by analyst is one year when State Bank of India price can reach defined target.

State Bank of India, incorporated in the year 1955, is a banking company (having a market cap of Rs 412227.81 Crore).

State Bank of India key Products/Revenue Segments include Interest & Discount on Advances & Bills, Income From Investment, Interest and Interest On Balances with RBI and Other Inter-Bank Funds for the year ending 31-Mar-2022.



Financials
For the quarter ended 31-03-2022, the company reported a Consolidated Total Income of Rs 108034.68 Crore, up 3.35 % from last quarter Total Income of Rs 104528.22 Crore and up 4.45 % from last year same quarter Total Income of Rs 103430.64 Crore. The bank reported net profit after tax of Rs 9549.13 Crore in latest quarter.

Investment Rationale
SBI’s share price has increased by ~8% in the past one year. Improving return ratios with RoE touching 12-13% and RoA reaching 0.7-0.8%, offer long term visibility for the stock. The brokerage maintains BUY rating on the stock and value standalone bank at ~1.1x FY24E ABV and subsidiaries at Rs 186 per share with a target price of Rs 605.

Promoter/FII Holdings
Promoters held 57.59 per cent stake in the company as of 31-Mar-2022, while FIIs owned 9.97 per cent, DIIs 24.65 per cent.